India continues to lead as the fastest-growing large economy globally, with the United Nations projecting an annual growth rate of 6.6% for 2024. The forecast was revealed in the “World Economic Situation and Prospects 2025” (WESP) report released on Thursday. The report also anticipates a slightly higher GDP growth of 6.8% in 2025, fueled by robust exports, strong private consumption, and increased infrastructure investments.
India’s economic momentum is attributed to its expanding manufacturing and services sectors, which are expected to sustain growth in the coming years. Significant capital expenditure on infrastructure is predicted to deliver strong multiplier effects, further boosting economic performance. Favorable monsoon rains have also improved agricultural output expectations, contributing to an optimistic outlook for the agriculture sector in 2025.
Despite a slight dip from last year’s 6.8% growth, India’s performance remains noteworthy in a sluggish global economy, where overall growth is pegged at 2.8%. Comparatively, China’s growth projection stands at 4.8% this year, with further deceleration expected.
Inflation in India is projected to decline from 4.8% last year to 4.3% this year, staying within the Reserve Bank of India’s target range. Meanwhile, employment indicators have shown resilience, with near-record labour force participation and urban unemployment rates holding steady.
The UN report highlights India’s critical role in South Asia’s economic recovery, although it cautions against risks such as geopolitical tensions, external demand slowdown, and climate-related challenges.
